INNOVATION IN FINANCIAL REPORTING: THE ASPECT OF THE CAPITAL GROUP

Enterprises operating in capital groups are made to create consolidated financial statements according to IFRS. In Poland, when trying to assess a financial situation based on consolidated financial statements, one may receive misleading information about a given capital group. In the capital group, there may be enterprises whose financial security is threatened and are close to bankruptcy and the consolidated financial statement presents the financial standing of the group as good. Is the current formula of the financial statements perfect, is it possible to improve it? The purpose of the article is to create an innovative formula of a financial report that will allow to easily and clearly assess the financial situation of enterprises belonging to capital groups. The new formula allows to clearly present the threats as well as the current situation of the business entity. The disclosure of possible threat symptoms may first of all be helpful to the unit, it will mobilize to descend from such positions, it will be possible to react to the deterioration of the assessment results, and it will be possible to find a shorter, faster way to find an investor. Even an investor who has such information can offer help himself. Information about symptoms is very important if something goes wrong, bankruptcy is not avoided despite hiding data, but it allows reliable assessment of the entity by owners, management and other recipients. The report of the new formula eliminates all financial instruments that are securities and their derivatives. The authors presented a proposal for changes only for the statement of financial position, but the changes should affect all parts of the report, which should be of interest to accounting officers. The innovative model of the new financial statements has been presented on the example of four Polish large enterprises. The methodology has been based on the national financial statements, as well as international guidelines and a proposal for changes. Statistical methods, financial indicators and comparison methods have been used. The financial data comes from the financial statements of the four Polish companies from 2016. The analysis of examples of large Polish enterprises showed that for the financial assessment and operational and financial safety, more information was provided by a new report form. Such a formula would also be very useful for unit reports.